Government Operations Committee on March 12th, 2026

[The Chair, Conservative, Kelly McCauley]

We are in session.

My sincere apologies. I was dealing with an unavoidable emergency upstairs for a few minutes. I thank you for your patience.

Welcome to meeting number 31 of the House of Commons Standing Committee on Government Operations and Estimates.

We welcome back our colleagues from PSPC on the supplementary estimates (C).

The floor is yours for an opening statement. Please go ahead.

[Arianne Reza, Deputy Minister, Department of Public Works and Government Services]

Thank you, Mr. Chair, for welcoming us today.

Before I begin, I would like to acknowledge that we are gathered today on the traditional, unceded territory of the Algonquin Anishinabe people.

With me today are Nathalie Bertrand, senior assistant deputy minister, receiver general and pension; Michael Hammond, chief financial officer; and Lorenzo Ieraci, assistant deputy minister, policy, planning and communications.

We are pleased to appear before you today to answer your questions regarding the $43 million being sought through the supplementary estimates (C) for Public Services and Procurement Canada, commonly known as PSPC.

As the country is confronted with rapidly developing economic and security challenges, the federal government remains committed to investing in Canada while reducing expenditure on daily operations. The wide scope of PSPC's mandate allows the department to directly support many of the government's goals.

Mr. Chair, before taking your questions, I would like to provide details on PSPC's role regarding specific government priorities targeted within the Supplementary Estimates and also outline a number of funding requests directly applicable to PSPC.

In the face of continued economic and security uncertainties, the department is requesting $17 million to support advertising across other government departments and agencies. These funds are for campaigns that were unforeseen and cannot be supported by existing departmental or agency funds.

Mr. Chair, the supplementary estimates also contain a request for $13.5 million for accommodation costs for employees who provide pension services relating to the Public Service Superannuation Act, the Canadian Forces Superannuation Act, the Royal Canadian Mounted Police Superannuation Act, and the Canadian Forces pension fund and reserve pension fund. That's a lot of funds. This funding is a yearly administrative adjustment requested through supplementary estimates exercises.

Among the other requests contained within the estimates is a $2-million request for funding to establish a joint transition office to support defence procurement reforms.

The money is to be used to support the government's effort to streamline defence procurement and modernize Canada's military capabilities, as well as increase co-operation with allies.

These supplementary estimates also contain a request for $6.2 million of funding for the public lands for homes plan. This money would provide funding for the Canada public land bank and support the federal lands centre on disposals to unlock federal public lands across the country for housing.

We have a number of net transfers between government departments in the supplementary estimates before you today. These include transfer of unused funds from Global Affairs Canada to PSPC for costs incurred during the hosting of last year's G7 summit in Alberta.

Finally, I would also like to highlight that as a result of the government's work to transform its information technology infrastructure, data centres are being consolidated, leading to power and space savings. Consequently, PSPC will transfer $900,000 to Shared Services to compensate for power and space savings reductions, among other transfers.

In closing, Mr. Chair, PSPC is committed to further cost efficiencies and savings as we continue to work to support the government's agenda.

We're happy to take your questions. Thank you.

[The Chair, Conservative, Kelly McCauley]

Thank you, Ms. Reza.

Mr. Jones, welcome back. The floor is yours for five minutes.

[Scott Jones, President, Shared Services Canada]

Thank you very much, Mr. Chair.

I would like to begin by acknowledging that we are gathered on the traditional, unceded territory of the Algonquin Anishinabe people.

Thank you for the opportunity to appear before you today to discuss Shared Services Canada's requests in the 2025-2026 supplementary estimates (C).

I am joined today by SSC's chief financial officer, Scott Davis.

Shared Services Canada is responsible for modernizing and operating the government of Canada's core IT infrastructure, and is the department mainly responsible for delivering the government's agenda for digital transformation, efficiency, and the deployment of AI tools and automation throughout the Canadian government.

We deliver enterprise digital services that support departments in carrying out their mandates, while reducing duplication, strengthening cybersecurity, and driving efficiency across government. Modern and secure digital infrastructure is foundational to service delivery, national security and public trust. SSC delivers this foundation through shared, government-wide connectivity, hosting, digital and cybersecurity services. These services are common to the whole of government and are managed at enterprise scale.

Budget 2025 reinforced three clear priorities for the public sector: fiscal discipline, digital modernization and better services for Canadians. Shared Services Canada plays a direct role in advancing all three. Our ongoing work to modernize GC systems improves performance and reliability, while we continue to reduce costs by providing a government-wide enterprise approach to digital services.

Examples of this include SSC’s enterprise platforms service as a single, secure and cost-effective solution for enterprise applications, rather than departments creating and managing their own costly and siloed hosting environments. Our department is also launching its enterprise desktop service initiative, which will unify and modernize desktop delivery across the GC by providing a consistent, secure and accessible digital tool kit for public servants and move away from the current fragmented model, where each department manages its own engineering, assets and support. We also support the government’s commitment to digital sovereignty by protecting government data, securing critical infrastructure and maintaining control over key digital assets.

These priorities are reflected in SSC’s ongoing procurement to establish sovereign Canadian cloud capabilities for the GC, which prioritizes Canadian-owned and -controlled cloud service providers, in light of increasing geopolitical and cybersecurity risks. We contribute to the government’s buy Canadian objectives by fostering Canadian innovation and strengthening domestic digital capacity.

The funding before the committee supports two core outcomes: strengthening cybersecurity across government and meeting increased demand for secure digital services, particularly in support of national defence priorities.

For the 2025–26 supplementary estimates (C), SSC is seeking a net increase of $11.4 million, bringing its funding from $2.687 billion to $2.699 billion. This includes $13.3 million in new funding to support an enterprise security information and event management, or SIEM, solution, as well as $200,000 in associated employee benefit plan adjustments and $2.1 million in net decreases related to transfers with other organizations.

In addition, SSC is seeking an increase of $25 million in vote‑netted revenue authority. This reflects increased service volumes to support the Department of National Defence’s operational and modernization requirements for this fiscal year. The associated revenue will fully offset costs, resulting in no net impact on funding.

SSC works closely with the Treasury Board of Canada Secretariat and the Communications Security Establishment to protect government networks and infrastructure.

Each year, SSC blocks approximately 6.5 trillion cyber-threats—an average of 18 billion a day—to ensure that government systems remain operational and secure. The security information and event management solution will significantly strengthen our defences by automating and accelerating security monitoring across government, and it will replace an old legacy system that has existed. This will improve our ability to predict, detect and respond to cyber-threats, helping to ensure that critical government services, whether related to benefits delivery, defence operations or secure communications, remain available, trusted and resilient for Canadians.

SSC remains focused on delivering secure, reliable digital foundations that enable government to serve Canadians effectively. The funding requested in these estimates will allow us to strengthen cyber-defences, support growing service demand and continue to advance the government’s digital transformation agenda.

Thank you, Mr. Chair. I look forward to answering your questions.

[The Chair, Conservative, Kelly McCauley]

Thank you, Mr. Jones.

We'll start with—

[Jeremy Patzer, Conservative, Swift Current—Grasslands—Kindersley, SK]

I have a point of order, Chair.

Before we begin, I just want to make note of my disappointment in Minister Lightbound for not showing up and respecting our request for him to appear at committee. We were told that he was going to be away on paternity leave, yet we saw him in the House of Commons this week answering questions. We saw him all over social media, touring the countryside, hosting meetings—all kinds of things.

It's pretty disrespectful to this committee for the minister to decide not to show up when, clearly, he actually did have the time to be able to come to this committee. I think we went to great lengths to extend lots of time for him to be able to come. I just wanted to register that disappointment with the committee.

[The Chair, Conservative, Kelly McCauley]

Thank you very much.

Mrs. Block, the floor will be yours for six minutes.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Thank you, Chair.

Thank you, Ms. Reza and your other departmental officials, for joining us today, including Shared Services Canada.

I know it is our bureaucracies that tend to do a lot of the heavy lifting once direction is provided to you from the government. I know that we are here to discuss supplementary estimates (C) and that this is the third request by the government for additional spending this year.

I don't think I heard you mention it, but these estimates include a $1-billion loan for Canada Post. The government is running a deficit of $80 billion this year. Where exactly are you getting the money to hand over another $1 billion to Canada Post?

[Arianne Reza]

Yes, my opening remarks were uniquely focused on PSPC, but we have two Crowns that are seeking, through the supplementaries, some funding.

On Canada Post, we were recently with Minister Lightbound at this committee speaking about the potential for the $1-billion loan. It had been announced that day. It is currently structured as a loan, so there will be different repayment structures being examined with Finance.

I'll just turn to Lorenzo to see if he wants to add anything here.

[Lorenzo Ieraci, Assistant Deputy Minister, Policy, Planning and Communications, Department of Public Works and Government Services]

Thank you, Deputy.

Obviously, as to how this fits into the broader financial situation of the Government of Canada, the Department of Finance would probably be in a better position to provide a specific response to that question. The request was submitted and considered by the government and approved, and the announcement was about the repayable loan.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

The Parliamentary Budget Officer, in his report on the supplementary estimates, noted a section on frozen allotments. In your opening remarks, Ms. Reza, I think you spoke about funding being transferred from one department to another, but you have absolutely no idea how this money is being transferred to Canada Post in the form of a loan.

[Arianne Reza]

Let me start by making a distinction. The transfers that I referred to in my opening remarks are between core departments where there are adjustments, where services were rendered, as we did, for example, for the G7.

Canada Post is net new money being requested from the fiscal framework, which is really from the finance department, from the sender, from the Prime Minister, to look at different elements. That would be, as my colleague indicated, really more the mandate of Finance Canada to give you an assessment about.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

I think you've answered my question by saying that it's net new dollars. It's not something that's being transferred across departments. I thank you for that.

You mentioned the minister's last appearance at committee. That was on February 10. At the time, Minister Lightbound said that it was his “heartfelt wish” that Canadians would get their money back from the loans to Canada Post.

Are there any terms in the loan agreement that dictate that the money must be repaid within a specific period of time, and what happens if they are never in a position to repay it?

[Arianne Reza]

Those are very broad questions, but in terms of the actual structure of the loan, there have been long-standing terms and conditions associated with repayment, so that is the intention.

I don't know if Lorenzo wants to add anything.

[Lorenzo Ieraci]

Thank you, Deputy. I can add to that.

This funding is identified as repayable funding for Canada Post. There is, at this point in time, no specific timeline as to when there will be an ability to repay. There are obviously a number of factors being considered by Canada Post and the government, not the least of which is that Canada Post and its union are right now working to be able to ratify a collective bargaining agreement, which, if ratified, should actually help the situation because it would be the first time in over two years when there would be labour peace between Canada Post and its union.

To answer your question more directly, section 32 of the Canada Post Corporation Act indicates that if Canada Post is not in a position to repay an amount, the Government of Canada would then be paying for that. Right now it's considered repayable funding.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Right, so Canadian taxpayers will be responsible to pay for it if Canada Post does not find itself in a position to do so.

We did ask a Canada Post official for the loan agreement, and she told us she would communicate our request to her superiors. We have yet to receive it, even though at this committee we expect requests for information to be met within three weeks.

Ms. Reza, can you agree to table both the new loan agreement and the previous one with this committee?

[Arianne Reza]

I will take that back and get back to the committee chair as quickly as I can, to see what is within the parameters.

To go back to the loan agreement as well, as you know, Minister Lightbound has asked for a transformation plan to position Canada Post to optimize its business processes to be able to come back to make the chance of repayment.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Thank you very much. I will just note that the minister made the announcement of that transformation plan at a time when there was still job action taking place and there was a sense of urgency around that. He's had that plan for four months and has not yet rendered a decision on it.

Thanks.

[The Chair, Conservative, Kelly McCauley]

We have Mr. Gasparro for six minutes, please.

[Vince Gasparro, Liberal, Eglinton—Lawrence, ON]

Thank you, Chair.

Thank you all for your service and for coming here today.

I think, given the current moment, we can all agree that we have to make regulatory changes and improve the speed at which government moves, delivers services and, quite frankly, innovates.

How do the changes in Bill C-15 to the Red Tape Reduction Act improve efficiency for Canadians and, more specifically, Canadian businesses?

[Arianne Reza]

Thank you for the question.

I will start by giving some examples. At PSPC, we obviously have a big portfolio, a lot of acts, a lot of regulations. We have identified those that we think are low-value and that are barriers to, for example, SMEs doing business. We're removing some of the ones related to physical infrastructure, such as docks, those areas that are very much based on some of the old infrastructure. We're removing those barriers so businesses can come and move more quickly.

On a broader scale, what we're trying to do from a procurement perspective is to look at all the different regulations that govern federal procurement and look to introduce harmonized procurement regulations, which will reduce the dwell time and the complexity and help optimize some of the key regulatory pieces that we're looking at. We have a list of them that is public. We're also currently reviewing the translation bureau regulations, which is a key part of how we undertake and provide official-language services.

I'll pause here.

[Vince Gasparro, Liberal, Eglinton—Lawrence, ON]

I have a follow-up on that. Do any other jurisdictions around the world follow similar practices?

[Arianne Reza]

Do you mean in terms of doing a review of their regulatory...?

[Vince Gasparro, Liberal, Eglinton—Lawrence, ON]

Yes.

[Arianne Reza]

We're constantly engaged with like-minded partners on this, especially in the world of procurement. You know, Canada is really doing a lot of work at this level in terms of harmonizing what we're doing at the federal level and working with provinces and territories but also seeing what's going on internationally.

In fact, the U.K. parliamentary committee has put a commission in place on procurement regulations and efficiencies, and yesterday they reached out to ask to come to Canada to study best practices. I think there's some synergy around how procurement is done, especially from the public procurement perspective, and we're looking to harmonize some of the best practices to make it easier for Canadian SMEs also to scale up globally.